Restart life

Chapter 352, page 0339: [Can I invest in Riot Games?]

Ding Xiaoqi left the office, and Qu Guohao was called in again. Chen Guiliang inquired about this year's CJ Expo and the two major leagues.

Game Science has grown in scale, and the procedures for various activities have become more standardized.

The annual ChinaJoy Electronics Show is the most important exhibition in China's gaming industry, with top game companies even setting up special teams of up to 50 people to be in charge.

Game Science has always been very haphazard in the past, and only this year has it started to have detailed planning.

In short, General Manager Qu Guohao sets the theme and finalizes the number of showgirls. Specific planning is handled by the Marketing Director and the Exhibition Manager. Frontline staff include: booth supervisors, public relations specialists, and on-site promotion team leaders.

The public relations specialist is in charge of the media aspect.

The task of the field promotion team leader is quite interesting. In addition to conducting on-site promotions, they are also responsible for collecting intelligence on competitors. For example, what game a certain company released, how the posters were made, how the events were organized, and where a certain super-popular female celebrity was recruited from.

"The exhibition planning is complete," Qu Guohao reported. "This year, all manufacturers are focusing on the Olympic theme, and we can't be an exception. As for the game peripheral products, I plan to donate all the sales revenue during the exhibition to disaster areas for reconstruction..."

"Cancel," Chen Guiliang interrupted directly.

Qu Guohao was taken aback: "Huh?"

Chen Guiliang explained, "Game Science and ByteDance have already organized donations, and I have also personally donated. We haven't publicized these things. Don't do any donations at the CJ expo; it's easy to attract criticism. In the future, the company will do charity quietly, just doing our part."

“Okay, I understand,” Qu Guohao continued. “Last year, the ShowGirls from various manufacturers wore too revealing outfits. This year, the organizing committee has mandated that skirts must be below the knee, and that tops can no longer be just bralettes. So the planning team is having a real headache with the costumes.”

Chen Guiliang laughed and said, "Not many companies will follow the rules. Let's ignore the organizing committee's nonsense, but we shouldn't deliberately dress provocatively either. Since the exhibition is closely related to the Olympics, let's go for a sporty theme. We'll specifically select young, lively, and energetic beauties to wear women's tennis outfits or something similar—sexy, sporty, fashionable, and not vulgar."

"Yup!"

Qu Guohao's mind was opened: "I'll have people select uniforms for various sports competitions right away. When recruiting beautiful women, they shouldn't be too delicate. Healthy, fashionable, youthful, athletic, and beautiful!"

Since the ChinaJoy expo is held in Shanghai every year, female students from the Shanghai Theatre Academy are the most sought-after, and they command the highest prices to be hired as showgirls. Next are female students from art departments of various universities.

Qu Guohao plans to contact student clubs at various universities in Shanghai, specifically recruiting beautiful girls from sports-related clubs who can also perform aerobics, badminton, and other activities on-site.

The more I thought about it, the more promising it seemed. I suggested setting up two or three ping-pong tables and drawing lucky audience members to play ping-pong with beautiful women.

This year's ChinaJoy expo is unprecedented in scale, with both the top two officials from the State Administration of Press and Publication personally attending—previously only Director Kou, who is in charge of games, made an appearance.

Last year's grand showgirl event featured hundreds of girls, and this year other companies are following suit by increasing the number of attendees. Perfect World is even planning a super carousel, with over a hundred showgirls accompanying lucky audience members on a ride.

Some manufacturers even publish a so-called "list of 100 girls" on their game's official website in advance, detailing the information of each showgirl and asking netizens to rate them before the event even takes place.

The Eight Immortals cross the sea, each showing their magical powers!
In addition to participating in the ChinaJoy electronics show, Youke will also be organizing two major leagues during the summer vacation. One is the "Three Kingdoms Kill" National College League (Finals), and the other is the "Future Era" National City Fighting League (Finals).

Both of these leagues are essentially self-contained competitions.

From spring to summer, contestants formed their own teams and registered to participate in online preliminary rounds, elimination rounds, semi-finals, and finally an offline grand final during the summer vacation.

All of this is preparation for developing real esports in the future.

Speaking of esports events...

Qu Guohao asked, "President Chen, why do you insist on investing in that Riot Games? They've only made a demo so far; they don't even have a finished game yet."

Chen Guiliang said, "But the founder is one of the authors of the Dota map, so it has great potential for development."

“We can totally make one ourselves… well, let’s do it in a few years. Anyone who tries to do it now is doomed,” Qu Guohao said.

At this time, MOBA games similar to League of Legends had already appeared in the Chinese online gaming market. But it was truly a case of whoever made the move was doomed!
First, Chinese players' computer configurations are inadequate; second, current mainstream internet speeds are too slow. The game lags and disconnects frequently.

Let alone releasing League of Legends this year, even releasing it next year is highly unlikely. It won't be possible until 2010, after the overall upgrade of computers in China (especially in internet cafes).

If we start now, we can make the game a bit rough around the edges and then connect online using the same methods as StarCraft and Warcraft 3.

However, operating League of Legends using the online multiplayer modes of games like StarCraft and Warcraft 3 would inevitably lead to rampant cheating, lag, and distorted skill detection, resulting in a terrible player experience.

The most fatal flaw is that you can't sell skins. The exquisite skins you buy with money may render incorrectly or disappear completely on other players' computer screens!

……

Old Santa Monica, Southern California, USA.

A 200-square-meter open warehouse—that's where Riot Games' offices are located.

When Chen Guiliang was conducting the IPO roadshow last year, he sent people to try to acquire a stake in Quantum. However, the two founders were very cunning and refused to sell no matter how much money was offered, saying they would only notify Chen Guiliang when they needed to raise funds.

Now that the Series A funding round has begun, not only Chen Guiliang was notified, but Tencent also somehow received the news.

In addition, Benchmark and FirstMark also invested.

FirstMark has media and distribution resources that can help League of Legends with early promotion.

Benchmark provides technical support for League of Legends and helps build the esports ecosystem.

These two companies were essential to get involved. Without their investment, Riot Games and League of Legends would be ruined. Chen Guiliang would only be able to buy a useless company and a useless game.

Even if Chen Guiliang develops a similar game, it can only be successful in China and cannot be promoted globally because it lacks distribution channels and influence in Europe and America.

This is also why Riot Games' two founders remained unmoved when Chen Guiliang sent people to discuss the acquisition last year. Chen Guiliang is an outsider and cannot help Riot Games grow!

"Hello, Mr. Liu."

"haven't seen you for a long time."

Chen Guiliang invited Lü Zhihui, who was the person in charge of ByteDance's IPO last year, to discuss financing.

Tencent's negotiator was Liu Zhiping, who was also responsible for Tencent's IPO. He currently serves as Tencent's Chief Strategy and Investment Officer and eventually rose to the position of Tencent's President.

These two used to be colleagues at Goldman Sachs.

Lu Zhihui asked curiously, "Why would Tencent target such a small American company?" "I was wondering the same thing," Liu Zhiping countered, "Game Science hasn't done any overseas expansion before, so why are they suddenly investing in an American company?"

Lu Zhihui shrugged: "I was just doing this for someone else, I got paid to do it."

Chen Guiliang was a prophet.

Tencent, on the other hand, relies on its network of connections.

Chen Guang, who initially brought "Triumph" to Tencent, has been searching for overseas games. His former colleague is now the CTO of Riot Games.

"Gentlemen, let's begin," said Mark Merrill, co-founder of Riot Games, with a smile.

Benchmark Capital has confirmed its role as lead investor. Its negotiator, Thomas McMick, said, "I think we should first assess the valuation before discussing the funding amount and equity."

Generally speaking, valuation should be done before stock distribution.

But with Youke and Tencent vying for control, it becomes a matter of first grabbing shares and then valuing them.

Moreover, both Chinese companies' investments came with a clause demanding exclusive distribution rights for League of Legends in China. They simply couldn't reach an agreement.

Lu Zhihui said, "We think the fist has a lot of potential, and its valuation can be raised a bit more."

Thomas McMick bluntly stated, "Mr. Lu, if you continue negotiating like this, I will withdraw immediately!"

Lü Zhihui fell silent.

These two American companies absolutely cannot withdraw.

Once they withdraw, Riot Games and League of Legends will lose their investment value.

Mark Merrill stated, "I don't care how you negotiate. The combined shareholding of the two founders must exceed the 35% veto threshold!"

The negotiations stalled.

The two American companies that could help Riot Games grow and expand would not allow the company's valuation to be arbitrarily inflated. Furthermore, Riot Games' two founders required their shareholdings to be above the veto threshold.

Two Chinese companies are vying for the exclusive distribution rights in China.

The FirstMark negotiator said, "In that case, one of Tencent and Youke must be eliminated. Explain your respective advantages. Don't talk about financial advantages; we have plenty of money."

Liu Zhiping said, "QQ, Tencent's online communication product, currently has nearly 9 million users, even surpassing MSN. These 9 million QQ users drive traffic to League of Legends, enabling the game to spread rapidly in China."

Lu Zhihui said, "If it were really that easy to attract users, why are Tencent's games not able to grow big? Your game operation capabilities are very poor! My employer, Game Science, has had its 'Three Kingdoms Kill' game hold more than 95% of the Chinese market share for similar games for many consecutive years. 'Future Era,' launched last year, has already surpassed 180 million peak concurrent users amidst competition from many copycat games, holding more than 85% of the Chinese market share for similar games."

The Chinese online gaming market has exploded this year!
With the widespread use of computers and the increase in internet users, the number of game players has exploded.

The peak number of concurrent online players for "Fantasy Westward Journey" has exceeded 200 million, and the data to be released next month will reach 232 million.

"Future Era" also surged ahead, with peak concurrent users exceeding 180 million.

The data released for World of Warcraft in April was 105 million, but it has not been released since, and I don't know why.

One QQ user base has 9 million users, and a peak of 180 million concurrent users.

Mark Merrill listened to their speeches and thought they both sounded incredibly impressive. For a moment, he didn't know which one to choose.

The representatives of the other two American companies reacted similarly at this point.

Lu Zhihui said, "Youke is currently running esports events for two games. The 'Three Kingdoms Kill' league has already been held for several seasons. In the future, we will not only be able to operate 'League of Legends', but also its esports events."

Liu Zhiping said, "Your two tournaments are just fooling yourselves behind closed doors, with limited participants and viewers. Tencent's chess and card esports tournaments have long been part of international and Chinese esports alliances."

Lu Zhihui laughed and said, "Can an e-sports tournament for playing poker be compared to an online game?"

Liu Zhiping said, "No matter what kind of event it is, we have an experienced team. We are a large company with a market value of $150 billion and a complete business layout in multiple fields. It is a hundred times more convenient for us to organize e-sports events than for Youke."

Lu Zhihui said, "But Tencent lacks the ability to operate online games, and all the games you operated failed."

Liu Zhiping said, "Our QQ Dance game reached a peak of 160 million concurrent online players, and QQ Speed ​​also reached 110 million. The newly launched CF game had 30 concurrent online players in its first month!"

Tencent Games has also been a hit this year, especially the QQ series of casual games.

Lü Zhihui had done his homework thoroughly: "Those are all casual games. CF had 30 players in its first month, but who knows what will happen next? Tencent Games' player numbers often plummet in the second month."

The two kept arguing, making the other negotiators dizzy.

After much arguing, the founders of Riot Games still couldn't make a decision.

……

After the negotiations ended that day, Lü Zhihui called Chen Guiliang: "Mr. Chen, the talks have reached a stalemate. Also, I heard some news that Chen Guang, who is in charge of game imports at Tencent, is an old colleague of Riot Games' CTO. We might be kicked out."

"What if we offer more money, but less shares?" Chen Guiliang asked.

Lu Zhihui said, "The investment method you mentioned is called strategic premium investment, also known as sweet capital. It's worth a try, but I'm afraid Tencent might follow suit."

Chen Guiliang said, "Then let's give it a try."

If we really can't reach an agreement, then forget it; we can always develop a similar game ourselves.

After this thing is developed, it can't be launched immediately, otherwise it will definitely be a huge loss. It will have to wait until China's internet speed improves and computers are upgraded as a whole (in 2010) before it can be put into operation.

Moreover, it is difficult to promote globally unless a small number of shares are given up or huge profits are given to overseas partners.

Copyright doesn't matter, as long as the jungle monsters aren't made the same. The top, middle, and bottom lane maps don't constitute plagiarism.

(End of this chapter)